STATE OF COLORADO SALES
LICENSE TEST QUESTIONS &
ANSWERS 100% CORRECT!!
Three of the following types of motor vehicles are exempt from the truth in mileage
act. - ANSWERVehicles 10 years old or older
Vehicles having a gross empty weight more than 10,000 lbs
Vehicles not self propelled (Trailers)
The definition of a used motor vehicle dealer or used dealer - ANSWERA person
who attempts to negotiate a sale or lease of a used motor vehicle or powersports
vehicle with the intent to make a profit or gain
The Motor Vehicle Board is authorized and empowered to: - ANSWERAmend and
repeal rules, regulations and previsions
True or False: When advertising a specific number of motor vehicles, that same
number of vehicles must be invoiced to the dealer - ANSWERTRUE
What is a Bait and Switch - ANSWERAdvertising a low-priced product to attract
customers, then pushing to sell a higher-priced product
True or False: Selling, Leasing, Trade-In, with option to purchase, offering or
negotiating and exchange of interest in 3+ vehicles in any 1 year is prima facie
evidence that a person is engaged in the business of selling or leasing motor
vehicles - ANSWERTRUE
True or False: By obtaining an off-premise permit, dealers may sell motor vehicles at
another location on Sunday - ANSWERFALSE - No sales on Sundays
Federal cash reporting requires dealers to file form 8300 with IRS within how many
days of receiving $10,000 cash? - ANSWER15 days
What are wholesalers allowed to do? - ANSWERSell to dealers and other
wholesalers
or
Make a profit or gain selling to dealers and wholesalers
A motor vehicle salesman's license may be revoked/suspended on the following
grounds: - ANSWERViolating any of the terms and provisions
When is a salesman's license exempt from suspension? - ANSWERAdvertising a
salvaged vehicle while identifying that vehicle as salvaged
, What is the limit of dealer demo plates? - ANSWERA demo drive cannot exceed 7
days
What is the Colorado Lemon Law - ANSWERWhen a new vehicle has been
purchased with a manufacturer's warranty and it has a defect that substantially
impairs its use and market value within one year of purchase and that defect is not
repaired after a "reasonable number of attempts," the consumer may seek recourse.
A court may order the manufacturer to replace the vehicle or refund the purchase
price minus a reasonable allowance for use of the vehicle
When is motor vehicle insurance required? - ANSWERFor all registered vehicles
intended for use on Colorado roads
When are in-transit plates used? - ANSWERIn-transit plates must be used when
transporting vehicles from point of purchase to point of storage, or from point of
storage to point of sale
What can licensed dealers sell on Sundays? - ANSWERBoat trailers and
snowmobiles
Which of the following steps are required to properly and legally repossess a motor
vehicle? - ANSWEREffect a lien creating a security interest
Allow the required payment to default (become at least 10 days late)
Send or hand deliver a "right to cure" letter to the debtor and allow the debtor 20
days to cure
An advertisement may include - ANSWERLicensed name with the word DEALER
What is the definition of a used vehicle? - ANSWERAny vehicle that has been
previously bought from a licensed dealer
or
A demo vehicle exceeding 1500 miles
What is considered a deceptive trade practice? - ANSWERBait and switch
How many temp permits may a dealer issue for each roadworthy vehicle sold? -
ANSWEROne
An extension can only be issued but the DMV
True or False: Depot plates must be used during normal business hours to transport
a motor vehicle - ANSWERTrue - Must be used on all plates
What is required when advertising a lease of a motor vehicle with a payment
amount? - ANSWERAmount or percentage of the down payment
Terms of repayment (car payment date)
Annual percentage rate (interest rate of the loan)
What is NOT required when advertising a lease? - ANSWERDisclosing the cost of
lease
LICENSE TEST QUESTIONS &
ANSWERS 100% CORRECT!!
Three of the following types of motor vehicles are exempt from the truth in mileage
act. - ANSWERVehicles 10 years old or older
Vehicles having a gross empty weight more than 10,000 lbs
Vehicles not self propelled (Trailers)
The definition of a used motor vehicle dealer or used dealer - ANSWERA person
who attempts to negotiate a sale or lease of a used motor vehicle or powersports
vehicle with the intent to make a profit or gain
The Motor Vehicle Board is authorized and empowered to: - ANSWERAmend and
repeal rules, regulations and previsions
True or False: When advertising a specific number of motor vehicles, that same
number of vehicles must be invoiced to the dealer - ANSWERTRUE
What is a Bait and Switch - ANSWERAdvertising a low-priced product to attract
customers, then pushing to sell a higher-priced product
True or False: Selling, Leasing, Trade-In, with option to purchase, offering or
negotiating and exchange of interest in 3+ vehicles in any 1 year is prima facie
evidence that a person is engaged in the business of selling or leasing motor
vehicles - ANSWERTRUE
True or False: By obtaining an off-premise permit, dealers may sell motor vehicles at
another location on Sunday - ANSWERFALSE - No sales on Sundays
Federal cash reporting requires dealers to file form 8300 with IRS within how many
days of receiving $10,000 cash? - ANSWER15 days
What are wholesalers allowed to do? - ANSWERSell to dealers and other
wholesalers
or
Make a profit or gain selling to dealers and wholesalers
A motor vehicle salesman's license may be revoked/suspended on the following
grounds: - ANSWERViolating any of the terms and provisions
When is a salesman's license exempt from suspension? - ANSWERAdvertising a
salvaged vehicle while identifying that vehicle as salvaged
, What is the limit of dealer demo plates? - ANSWERA demo drive cannot exceed 7
days
What is the Colorado Lemon Law - ANSWERWhen a new vehicle has been
purchased with a manufacturer's warranty and it has a defect that substantially
impairs its use and market value within one year of purchase and that defect is not
repaired after a "reasonable number of attempts," the consumer may seek recourse.
A court may order the manufacturer to replace the vehicle or refund the purchase
price minus a reasonable allowance for use of the vehicle
When is motor vehicle insurance required? - ANSWERFor all registered vehicles
intended for use on Colorado roads
When are in-transit plates used? - ANSWERIn-transit plates must be used when
transporting vehicles from point of purchase to point of storage, or from point of
storage to point of sale
What can licensed dealers sell on Sundays? - ANSWERBoat trailers and
snowmobiles
Which of the following steps are required to properly and legally repossess a motor
vehicle? - ANSWEREffect a lien creating a security interest
Allow the required payment to default (become at least 10 days late)
Send or hand deliver a "right to cure" letter to the debtor and allow the debtor 20
days to cure
An advertisement may include - ANSWERLicensed name with the word DEALER
What is the definition of a used vehicle? - ANSWERAny vehicle that has been
previously bought from a licensed dealer
or
A demo vehicle exceeding 1500 miles
What is considered a deceptive trade practice? - ANSWERBait and switch
How many temp permits may a dealer issue for each roadworthy vehicle sold? -
ANSWEROne
An extension can only be issued but the DMV
True or False: Depot plates must be used during normal business hours to transport
a motor vehicle - ANSWERTrue - Must be used on all plates
What is required when advertising a lease of a motor vehicle with a payment
amount? - ANSWERAmount or percentage of the down payment
Terms of repayment (car payment date)
Annual percentage rate (interest rate of the loan)
What is NOT required when advertising a lease? - ANSWERDisclosing the cost of
lease
